MFA Blog

MFA Hedge Fund Glossary Word of the Day: Alpha

Posted on February 26, 2014

MFA Hedge Fund Glossary Definition – Alpha is the amount that an investment’s Average Rate of Return exceeds the Risk Free Rate, adjusted for the inherent Systematic Risk. Alpha measures the value that an investment manager produces, by comparing the manager’s performance to that of a risk-free investment.

Want to learn more about this and other terms like it?  Visit MFA’s hedge fund glossary and look for more Words of the Day on MFA’s blog and on Twitter.